Know the Different Types of Insurance Coverage Available

When most people submit a quote for car insurance coverage, they might just end up going with one of those “recommended” policies.  Many people don’t take enough time to really look at what the policy covers and see if what they are insuring is really right for their situation.  Here are six of the most basic things insurance covers, and what they are used for.

• Injury Liability: Bodily Injury Liability is the most basic of coverages and is the one part of your policy that is required by law.  Basically it covers you in case of injury or death of another driver (or passenger) in the case of your car causing the accident.  We recommend $25,000 coverage, but that should be increased higher if you have a higher net worth (and therefore, more assets that could be seized in judgment).
• Property Damage Liability: Liability for Property Damage is another coverage that is required for all drivers.  It is the same as the Injury Liability, but for damage to property incurred by your car.  If you hit a mailbox, or drive through someone’s house, this is the coverage that you will need.
• Collision Coverage: Collision on your policy covers damage to your car in an accident caused by you.  This usually has a deductible (meaning the amount you pay first) between $0 and several thousand dollars.  If your car has little value, it is likely you do not need this coverage.
• Comprehensive Coverage: Comprehensive Coverage is optional.  It covers damage to your car from non-accident events.  These could include theft, fire, vandalism, or even floods.  It is a good idea to have comprehensive coverage just like collision coverage, and you can set your deductible based on how much you can pay.
• Medical Payments:  Medical insurance on your auto policy specifically covers bodily injury experienced by you or other passengers in your car from an accident.  This is optional and definitely recommended.
• Uninsured motorist protection:  This covers injuries or physical damage caused by uninsured drivers or if your car is damaged in a hit and run.

It is important to know these types of coverages, for you to be able to pick what coverage is right for you.